Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1887-12-03
Jun, luz of per cent per anuum. 200: Total

Sl4.0O. ''' 1"' io'al'
IL this seems an excessive burden II mps.
De remembered that meanwhile house rent is
saved and property is being accumulated.
A DEFALcArroS.
on the 18th day of August Frank c. Nc
Neaiiy, boy IS years of age. EMPLOYED as
CLERK IN the Saco and Bi,ldeford Savings In
sttunon, disappeared, CARRYING with him
Sso.oVo par value of negotiable bonds and
s3,5W in currency
thorough and exhaustive examination was
Immediately made of the affairs of the insti-
'u.ion' ana detailed statement of its results
VIII De found on page ls5 of this report.
fubiic notice was given TO holders of de-
post books to present them for verification
WIN the books Of the Savings Institution, and
IN the four weeks occupied by the investipa-
ton some 20O0 pass-book. were exsyr;ned
trial balance was also made of the DE
posters Ledgers" and the General Ledger
accounts. While the bank sustains a large
loss, it was found that it still had surpIu.
above all liabilities of s4G4,94224 Itis to-
DAY one OF the strongest fduciary institutions
in New England.
MONEY AND INVESTMENTS
During the year the last outstanding OBJ
tional bonds have been called. and notwith-
standing the money has been poured into the
treasury at the rate of 81 600 900 per week.
the government has been powerless TO redis-
Tribute the excess over current expenses bv
further reduction of the debt, except through
the option OF the holders of the outstanding
IL and per cent bonds, which have sew
eral years yet to run before maturity
These bonds are largely held by individual
TO frn5t
ment, not likely to be disturbed, hence the
amount voluntarily offered for sale to the
Government must be comparatively small
While the national bank circulation has de-
creased s24, 6S5 SOB since December 81, 1856
it is believed that the aggregate circulating
medium of the country has largely increased
The increase in gold coin silver dollars and
subsidiary coin during the year ending June
30, 1887, was S54 AL ,727, and this amount
has since been considerably increased by the
coinage of gold and silver coin and the i'm
ports of gold.
Admitting that the circulation is 500 ,000,-
900 more than a year ago, yet the rapldity
with which it is constantly absorbed by the
treasury, with the government powerless to
obviate vast contraction by an enormous
treasury accumulation, except through the
consent of the holders of the bonds to volun-
tarily surrender them in exchange for cur
rency at price to be agreed upon in each
individual instance, has afforded menace of
money famine which has been the leading
factor in depressing the value of securities.
While the fear of accumulation of money in
the treasury has been general throughout the
United States there have been influences at
work, the result of which has been more
keenly felt in New England than elsewhere.
Most of the National banks in the East were
organized in the early period of the present
banking system and their circulation was
originally secured by six and five per cent
bonds, which were afterwards converted into
the optional IS; and as these have been
called from time to time, rather than create
the large premium account necessary to
maintain their original circulation, they have
reduced the same to the minimum provided
by statute. While this process has been
gradually reducing the volume of national
bank circulation in the East, new national
and state banks have been established at a
rate of several per week in the West, largely
by money sent from New England and per-
manently planted as banking capital of the
West. BY an act of Congress approved
March Sd, 1887, it was provided that when
ever three fourths in number of the national
banks located in any city of the United
States having population of 10000 people
shall make application in writing to the Comp
troller of the Currency, asking that the name
of the city in which such banks are located,
it shall be added to the cities named re
serves cities where an amount equal to
twenty five per cent of their circulation and
deposits shall be kept in lawful money as
reserve fund.
In accordance with the provisions of this
act the cities of Omaha, st. Joseph and
Kansas City have been designated reserve
cities" by reason of which very consider
able amount has been transferred from the
money ccnters of the East to these new re-
serve cities in the West. As the cities west
of the Missouri River have multiplied their
population by the enormous immigration,
new towns farther and father ives have
sprung into existance, peopled almost in a
day, and the great railroad corporations have
been wing with each ether in extending their
lines to keep pace with the western
march of civilization. During the year
now approaching its close, l2 900 miles of
railroad have been built, mostly in the West,
costing $3.50, 900 900, and the stockholders,
mostly eastern capitalists. have been called
upon to pour down their money, 10000, 900
at time, to pay for its construction. The
immediate effect of this has been to deplete
the East of money and permanently plant it
in the West The future effect cannot be to in
lure the West through having been developed
by foreign capital, and the problem of joys
or sorrows to the eastern shareholder will
be solved when it has been demonstrated
whether the growth of the country and the
increase of business will be sufficient to rem
der the operation of the hundreds of miles of
parallel roads recently constructed profitable
on the basis of their cost.
SAVINGS BANK MANAGEMENT.
We sometimes find in the same locality
two corporations engaged in manufacturing
the same article of merchandise.
One prospers, grows rich, earns and pays
liberal dividends and maintains high credit.
The other exists from year to year, its stock
holders receive little benefit from its exist
ence and its credit is never above suspicion.
The causes which produces these opposite
results in most instances, are attributable to
the fact that the one has well organized
board of directors who attend to the business
of the company, while the directors of the
other corporation neglect their duties or
delegate its management to a subordinate
officer.
The same cause will produce similar re-
suits if applied to savings banks. fla bank
has well organized board of trustees whose
efforts are constantly employed in promoting
its welfare. it is almost certain to enjoy high
credit and to increase in prosperity. If
trustees fail to appreciate the responsibility of
their office. accept it an as honorary recog-
milton, assume that the only duty it imposes
upon them is to complete the organization
by electing treasurer, fix his salary SO low
that without other resorces he must almost
90 hungry, and exchange congratulations
with the depositors upon the economy e1er-
ci,ed in the management of their trust then
let the creditors of such an institution pre-
mare for disaster If the treasurer complains
at the meagerness of his salary, such board
would be likely to encourage him with the
reinsurance. that the office to which he has
been elected gives him standing and a
credit which will enable him to make more
than his salary from other sources. Such
board would not be likely to complain If the
officer received deposits in his own name and